Serving Northwest Oklahoma since 1895                Insurance ~ Real Estate


Be careful what you pay for. . .


Yes, these are tough economic times, when every penny counts.  Particularly for our friends in the business community, there is suddenly an inundation of agents and brokers clamoring to write commercial insurance for prices that just seem too good to be true.  But with quotes that are anywhere from 20% to 50% lower than your existing policy--even if the insurance company is an excess market--how can an owner or manager turn down such savings?  Here's how!


An excess (or non-admitted) insurer is not regulated or overseen by the Oklahoma Insurance Department.  Their rates are not on file with the Department; they are not subject to claims guidelines established by the Department.  If a non-admitted carrier declines your claim--or just refuses to pay it--you the insured cannot look to the Insurance Department for relief, but instead must take legal matters into your own hands. . .and at your expense.


Even worse, should the insurance company become insolvent, because it is non-admitted it is not subject to the Oklahoma Property & Casualty Guaranty Fund, which offers relief to claimants if admitted insurers become insolvent.  So when excess markets become insolvent, there is no relief to insurance claimants--other than, again, taking matters into your own hands. 


Something else to consider:  Does the excess market policy have the same coverages as the admitted market policy?  You definitely want a policy from the excess insurer that is just as broad as the current one from your admitted carrier.  Many common protections under an admitted insurer (theft is a good example) are often not covered under an excess carrier.  Filing a claim for an occurrence you knew was covered under your old insurance company, only to find out it is now excluded under your new excess policy is a very costly lesson to learn!   


So those 30% savings that looked so good when you cancelled your policy with an admitted market and went with an excess market suddenly look like a pittance when you suddenly become legally liable for a $150,000 claim--and the insurer either refuses to pay the claim, or can't, due to insolvency.  Before making such a decision call your agent who represents the admitted market; find out about the financial stability and financial rating of the excess market:  make an informed decision!  Because when it comes to a complicated matter like a commercial insurance policy, very frequently cheaper isn't better! 

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